Update – Northern Territory Construction Contracts (Security of Payments) Legislation Amendment Bill 2019

On Wed, 15 May 19, the Northern Territory Attorney-General introduced into the NT Parliament the Construction Contracts (Security of Payments) Legislation Amendment Bill 2019 (CCSP Bill) seeking to make improvements to the CCSPA.   On Mon, 20 May 19, at a Public Hearing into the Bill, the Policy Lawyers advised the NT Parliament’s Economic Policy Scrutiny Committee the primary aim of the Bill “is to clarify when a payment dispute arises, when adjudication may occur and how determinations may be enforced.”

The Committee has invited submissions from the public in relation to the Bill by Fri, 14 Jun 19.

CCSPA and CCSP Bill

The CCSPA was created for a faster and low-cost method to resolve payment disputes between contractors and subcontractors.  Adjudicators determine whether payments are to be made under a construction contract.  If other proceedings commence related to the dispute, the adjudicator’s decision will stand, pending the final decision of a Court or arbitrator on the dispute.

Some of the changes are set out below.

  • ‘Construction contract’ is to be amended to clarify the CCSPA may be used to resolve disputes over payments arising from contractual obligations after it has ended.  The contract remains a contract even if expired or terminated.
  • The timeframe which a party must do a thing was previously described in ‘days’.  This will change to ‘working days’. ‘Working day’ will exclude 25 Dec – 7 Jan.
  • The timeframe for applications for adjudication starts the day after the event giving rise to the payment dispute occurs (ie day after failure of payment by due-date of invoice).
  • A new provision enables an appointer to consult with the parties on the qualifications of the adjudicator to address the issue that some circumstances require differing levels of qualifications in specific areas.
  • The claiming party can include an additional related claim in the same application if the original application has not been determined (eg rolling invoices permitted under contract).
  • The timeframe for a party to respond to a payment claim will be increased to 15 working days.  The respondent can rely on what the applicant submitted to avoid doubling up on material already provided.
  • Given invoices can be automatically generated and sent electronically, the requirement to sign a payment claim will be removed.
  • To recognise the increasing inclusion of large artistic constructions in construction projects, ‘Construction work’ will no longer exclude artistic works.

In relation to some changes to adjudication procedures, it is proposed the adjudicator be allowed to:

  • dismiss a second, or subsequent, application on the same dispute to avoid multiple applications and processes on the same subject.
  • proceed with an application that does not fully comply with the CCSPA, if the adjudicator accepts there is substantial compliance and it does not affect the merits of the application. This is proposed to address issues of applications being unnecessarily struck out, requiring the claimant to re-apply and result in delay.
  • assess liquidated damages and include that assessment in the determination, if the assessment of liquidated damages is consistent with the construction contract.
  • adjudicate two or more payment disputes between the same parties, provided the adjudicator has formed the opinion this will not adversely affect the ability to determine each dispute on their merits. Previously, the adjudicator had to seek consent.

In relation to Small Claims under the Community Justice Centre Act

  • Parties can utilise this legislation for a cheaper option in relation to small claims, currently set at less than $10,000.
  • The amendments propose this cap be replaced by an amount as varied by Regulation.  The sum of $30,000 is proposed.

For further information please get in touch with our lawyers at RLA

office@rousssoslegaladvisory.com
+61 8 8981 8783
www.roussoslegaladvisory.com
GPO Box 457 Darwin Australia 0801

We hope you enjoyed reading our update.  It is not a substitute for specific legal advice.  We would be pleased to assist you with your specific enquiry; in which case please contact us per the details above.   We cannot accept any liability or responsibility for loss occurring as a result of anyone acting or refraining from acting in reliance on any material contained in this summary.